[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H. Con. Res. 18 Introduced in House (IH)]







104th CONGRESS
  1st Session
H. CON. RES. 18

  Expressing the sense of the Congress that United States investors, 
 lenders, and corporations should assume the full measure of risk and 
  responsibility for their investments and loans in Mexico since the 
devaluation of the peso on December 21, 1994, and that loan guarantees 
 that are backed by the full faith and credit of the United States and 
that could result in any direct or indirect financial obligation on the 
 part of United States taxpayers should not be provided to the Mexican 
                              Government.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 24, 1995

 Mr. Sanders (for himself, Mr. DeFazio, and Mr. Miller of California) 
 submitted the following concurrent resolution; which was referred to 
            the Committee on Banking and Financial Services

_______________________________________________________________________

                         CONCURRENT RESOLUTION


 
  Expressing the sense of the Congress that United States investors, 
 lenders, and corporations should assume the full measure of risk and 
  responsibility for their investments and loans in Mexico since the 
devaluation of the peso on December 21, 1994, and that loan guarantees 
 that are backed by the full faith and credit of the United States and 
that could result in any direct or indirect financial obligation on the 
 part of United States taxpayers should not be provided to the Mexican 
                              Government.

Whereas United States investors, lenders, and corporations in the private sector 
        are to assume the risks and responsibilities associated with free market 
        economics and free trade policies without government interference and 
        without foisting those risks and responsibilities on United States 
        taxpayers directly or indirectly;
Whereas many United States investors, lenders, and corporations profited greatly 
        as values in Mexican stocks rose on average 118 percent in dollar terms 
        in 1991 and 49 percent in 1993;
Whereas the stability of the Mexican economy and political system has been 
        shaken since January 1994 by an indigenous peasant rebellion in the 
        Mexican State of Chiapas, 2 high-visibility political assassinations, 
        and a tumultuous election campaign;
Whereas Mexican foreign reserves declined during 1994 from $30,000,000,000 to 
        $6,000,000,000;
Whereas the Mexican Government deceived investors, lenders, and corporations by 
        holding the peso steady throughout 1994 despite its growing 
        overvaluation;
Whereas Mexican Government officials, on December 21, 1994, abruptly decided to 
        ``free float'' the peso, despite giving assurances to the contrary to 
        United States financial leaders less than 1 week earlier, which has 
        resulted in a 35 percent devaluation of the peso relative to the United 
        States dollar during the ensuing month;
Whereas this sudden devaluation of the peso, the latest in a series of frequent 
        devaluations during the past 30 years, represents an immediate and 
        draconian 35 percent decline in the standard of living of the Mexican 
        people, especially for the 30 percent of Mexican workers who earn $1,680 
        a year or less;
Whereas many wealthy Mexicans moved substantial sums of their own money out of 
        Mexican holdings just prior to this most recent devaluation of the peso 
        and continue to do so;
Whereas the devaluation of the peso will greatly encourage multinational 
        corporations to invest and produce more in Mexico because their dollars 
        now will buy substantially more Mexican goods and services than before, 
        including cheap, unprotected Mexican labor, thus causing the loss of 
        additional United States jobs and discouraging new investment and job 
        creation in the United States;
Whereas all Mexican consumers now must also pay dramatically increased prices as 
        much as 30 percent higher for basic foodstuffs such as cooking oil and 
        grains, which is certain to sow the seeds of greater social and 
        political unrest;
Whereas the foreign debt of Mexico currently exceeds $160,000,000,000;
Whereas nearly $30,000,000,000 worth of Mexican ``tesobonos'' or short-term 
        dollar securities become due in 1995;
Whereas the international financial community is not meeting its 
        responsibilities and committing proportionate resources to redress the 
        financial peril precipitated by the most recent and sudden devaluation 
        of the peso;
Whereas the national debt of the United States exceeds $4,000,000,000,000 and 
        continues to climb steadily every year;
Whereas during the past decade American taxpayers were forced to provide more 
        than $150,000,000,000 to cover the costs of the bankruptcies of hundreds 
        of savings and loan institutions in the United States that were ruined 
        by reckless investors and irresponsible financial managers who escaped 
        Federal oversight;
Whereas the United States Government continues to spend far more every year 
        beyond the revenues collected;
Whereas many proposals are pending before the Congress to eliminate scores of 
        existing Federal programs and to dramatically reduce funding for many 
        other programs in order to reduce the financial burden on United States 
        taxpayers; and
Whereas the President and the Secretary of the Treasury have already extended a 
        $9,000,000,000 line of credit to bolster the peso without adequate 
        consultation and debate in the Congress: Now, therefore, be it
    Resolved by the House of Representatives (the Senate concurring), 
That it is the sense of the Congress that--
            (1) United States investors, lenders, and corporations in 
        the private sector should assume the full measure of risk and 
        responsibility for their investments and loans in Mexico since 
        the devaluation of the peso on December 21, 1994; and
            (2) loan guarantees that are backed by the full faith and 
        credit of the United States and that could result in any direct 
        or indirect financial obligation on the part of United States 
        taxpayers should not be provided to the Mexican Government in 
        the aftermath of the devaluation of the peso on December 21, 
        1994.
                                 <all>